Bank of Portugal lowers economic growth forecasts

The Bank of Portugal has announced that it believes the country’s economic recovery in the next two years will be slower than originally expected.

While it is confident the economy will keep growing, its forecasts aren’t as optimistic as they were in June.

Portugal’s GDP is expected to grow 1.6% this year, as opposed to the 1.7% forecast six months ago. Estimates have also dropped for 2016 (1.7% as opposed to 1.9%) and 2017 (1.8% compared to 2%).

“The main risk factors are the possibility of a more moderate recovery of global activity and global trade flows, particularly in emerging economies,” the central bank said.

Still, the bank is confident that increases in families’ “spending power, in domestic demand and exports” will continue to strengthen Portugal’s economy.

Portuguese families are expected to spend 2.7% more this year, followed by 1.8% and 1.7% growths in the following years.

Investment is also set to increase 4.8% this year, and 4% and 6% in 2016 and 2017 respectively.

Exports are also expected to keep growing, with the Bank of Portugal predicting increases of 3.3% in 2016 and 5.1% in 2017.